6 Reasons Mobile Trading Misses the Mark
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Why is Mobile Trading bad for Day Trading
The web will tell you that mobile trading is any form of trading with a device while on the go. This really falls into two categories: (1) mobile phones and (2) tablets. I can make the argument that my laptop would qualify as a mobile device when linked to a wide area network, but let's not complicate the matter.
In this article I will cover the 6 reasons why mobile trading is not a fit for day trading. I will focus on mobile phones since tablets are becoming more and more like laptops by the minute.
Mobile trading platforms are just that - mobile. By default you are either using the network as provided by your cell phone provider or are on a Wi-Fi network.
Recently mobile carriers have done a nice job of increasing network speeds with LTE. This is noticeable when downloading a song or browsing your favorite gossip site. However, these networks were not setup for people that want to stream tick data, level 1, time and sales and charts.
Think about all the times you have lost your cell phone signals. Some carriers more than others, but we all can relate to our frustrating it is to call someone back and try to pick up where we left off in a conversation. Imagine you are trying to open or close a trade and you lose your signal. Even if this happens just once, if you are day trading this could cost you hundreds or thousands of dollars.
Are you willing to take this risk?
Screen is Too Small
I probably should have led in with this one, but the screens are way too small. The average screen height is ~ 4 to 6 inches and the width is ~2 - 3 inches.
Now I want you to picture your current day trading computer setup with multiple screens and imagine shrinking all of that down to a space of 6 inches if you swivel the phone on its side.
Even if you have read my article on how many monitors you need for day trading and have gone down to just 1 monitor, you are still likely giving up two-thirds the real estate from an average size laptop.
What would your configuration look like? I need market movers, an order entry bar, 5-minute chart, 15-minute chart, volume and my portfolio information at a minimum. Maybe some of you can email me screenshots of your mobile phones to make me a believer, but I do not see how someone can effectively day trade without this information.
More Prone for Errors with the Smaller Keyboard
The problem with using keyboards with mobile apps is they will either force you to another window away from your chart or will reduce the size of your current window to display the keyboard. Neither of which are great options.
I haven't even touched on the worst part yet, God forbid you have larger than average hands. You are now stuck trying to type in the ticker symbol of the stock, number of shares, select the order type and then click the button to submit the trade. Don't forget to add on the fact you are likely rushing because you are day trading.
How many times do you think you could input this much data flawlessly?
I am not a big features guy. Whenever I hear people say they need 5 or 6 indicators I know that trader is not making any serious money. However, there are basic features you need that can provide a tremendous help when day trading. The problem with mobile trading applications is there just isn't enough space. For what you gain in mobility you have to sacrifice in capabilities.
Instead of the mobile application providing you the means to trade in the fashion you have become accustomed, you would now need to change your trading style to meet the needs of the application.
A golden rule of IT is technology should enhance your user experience, but it should never alter the core essence of what you are trying to accomplish.
Are you prepared to develop an entirely different day trading strategy in order to trade on your mobile phone?
You may get a phone call
If you look at the top trading platforms, none of them really touch on this point. The mobile phone's primary function is to allow you to make and receive phone calls.
Let me setup another visual for you. You are day trading a stock and are waiting for the security to breakout. Right as the stock approaches a key level, your friend calls to see if you saw the American Idol finale show. While you love your friend, you quickly hit ignore, but by the time your phone goes back to your mobile trading platform you have missed the trade.
Lack of Focus
Computers already provide way too many distractions that can pull you away from your primary focus which is day trading. There is the internet, games, books, you name it. These distractions are only further increased with mobile phones. The key differential is for the desktop you have to consciously select other applications. On your mobile phone these distractions are inbound. They can come in the form of calls and the ever present text messages.
You can disable these features, but will you really? The entire point of mobile trading is so you can be on the go and still conduct your life and business without a hitch. Therein lies the problem, when trading you should just be trading.
The phone on some level provides you the ability to leave your quiet place and venture out into the world. This may sound great, but the person who is sitting quietly focused watching the tape and sizing up the trade in real-time will undoubtedly eat your lunch.
Trading with Tablets
If the title of the article wasn't enough already you should have I'm not a huge supporter of trading with mobile phones.
Now when it comes to trading with tablets, things become a bit blurry for me. The tablets are large enough that if you do not have a lot of clutter on your screen you can see things clearly. You do have the ability to zoom in and out on your charts with ease.
The downside is again if you need to use your keyboard you lose the ability to view charts effectively. Or is this really an accurate statement? You could buy a tablet like the Microsoft Surface which comes with an external keyboard.
While the surface tablet can mimic the laptop, how do you carry the extra monitors you have at home? So, no matter how close a tablet can come to your in-home setup, you will still need to modify how you trade.
I am all for looking at stock data on mobile phones if it's after market hours or for tracking a retirement account on the go. However, to conduct active trading on your cell phone is a sure way to lose money over time. Success in trading goes to the trader who makes the least amount of mistakes. Trading is truly a game of precision.
Let me try communicating this another way. For those of you with desk jobs, have your employers approved a policy for all work over should be conducted over mobile phones? Of course not. Why should your trading be any different?
Just because there is an app for trading doesn't mean you should use it. The latest window phones allow you to access word, but I still draft up all of my documents on my laptop.
Do yourself a favor, slow down and focus. Let the other guy try day trading from his iPhone while at the movies, you'll be on the other side of the trade at your desk ready to do battle.
Still think mobile trading is possible; please try our day trading simulator at Tradingsim. Notice how much functionality you lose when you go from trading on your desktop to your mobile. Practice for a few days and see if you don't arrive at the same conclusion as I have written up in this article.
Good Luck Trading
Man on cell Phone by Héctor Romero
LAN Connection by acidpix